Just when one thought the FOMC couldn’t get more dovish, they get more dovish, specifically on inflation. They toned down the outlook by saying the “economic recovery is proceeding” vs “economic activity has continued to strengthen” in Apr. They referred to the improvement in the labor market as gradual. They took out “housing starts have edged up” out of the statement as they should and they also implicitly referred to Europe by saying “financial conditions have become less supportive of economic growth on balance, largely reflecting developments abroad.” On inflation, they referred to the drop in energy and other commodities as helping to lower the trend of inflation. Of course in Apr when copper was at $3.65 and oil was at $90, the FOMC didn’t mention the upside risks to inflation, thus the very dovish commentary. Rates will stay “exceptionally low” for a very, very, very, very long time.

Category: MacroNotes, Uncategorized

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4 Responses to “Just when you thought the Fed couldn’t get more dovish”

  1. SINGER says:

    Japan 2.0

    The only difference is the porn isn’t censored and the sushi isn’t as good….

  2. Rescission says:

    The Bond bears keep taking it on the chin.

  3. FrancoisT says:

    You ain’t gonna saved this money safely! Thou shall gamble and speculate!
    So sayeth Burnt Winkie!

  4. Simon says:

    More thieving from savers and wage earners. IMOP this can’t go on forever. People are starting to wake up. Anyone with an internet connection and an average IQ, like me, can figure it out. People are going to try to find alternative currencies. How can you save for your retirement when the government is giving you nothing for your legal tender and the markets are gamed and volatile. It turns the economy in to a prison colony where the only way to escape is to beat the house in high stakes gambling.